Several Chinese media outlets reported that China's housing
minister told reporters on Monday at the 18th Communist Party
congress that he does not expect any loosening on restrictions
on the sector.

Turnover in Hong Kong at midday was the lowest in a week,
with traders citing festering uncertainty over the U.S. fiscal
situation and further aid to debt-stricken Greece as keeping
investors on the sidelines.

The Hang Seng Index went into the midday break down
0.9 percent at 21,238.3. The China Enterprises Index of
the top Chinese listings in Hong Kong shed 1.7 percent.
Tuesday's losses took both indices to their lowest since
mid-October.

In the mainland, the CSI300 Index of the largest
Shanghai and Shenzhen listings sank 1.6 percent. The Shanghai
Composite Index fell 1.4 percent.

Investors are taking the continuation of housing curbs "as
perhaps a sign there won't be any loosening or changes in
Beijing's economic policy positions in the near term," said Hong
Hao, chief equity strategist at Bank of Communications
International Securities.

"A lot of the money that has come into offshore Chinese
equities in the last nine weeks has gone into the cyclical
names, betting on stronger growth from policy changes, but I
think they will be disappointed," Hong added.

The China Enterprises Index or the H-share index, has shed
5.2 percent from a Nov. 2 high, after surging 14 percent in
September and October, ranking among the top performing indices
in those two months.

This compares to the 3.9 percent loss on the CSI300 Index
and a 3.2 percent slide on the Shanghai Composite since Nov. 2.

The Hang Seng Index A/H premium index is now at
99.9, its highest since mid-October. It has traded below 100
since Oct. 18, suggesting the premium that onshore markets
typically trade over offshore peers was wiped out during that
period.

Shares of Chinese oil giants were put on the defensive due
to falling oil prices. Chinese media also reported on Tuesday
that Beijing could cut gasoline and diesel prices in the
mainland for a fourth time this year, perhaps as soon as
Wednesday.

Zoomlion Heavy Industry shed 3.2
percent in Hong Kong and 1.6 percent in Shenzhen. Zoomlion was
among the top performers among Chinese growth-sensitive names,
surged more than 25 percent in September and October.

Official data for October housing prices is expected on
Sunday, but in a sign of things to come, the state-run China
Securities Journal, citing data from the Beijing Municipal
Bureau of Statistics, reported that Beijing property sales in
the first 10 months of 2012 rose 30.4 percent from a year
before, surpassing full-year sales in 2011.